SAP R/3 Customer, Supplier, and Enterprise Organizational Data Structures

When addressing Business-to-Business (B2B) Customer and Supplier Master Data Management, this documentation considers the following industries:

Customer MDM Domain

  • Consumer Packaged Goods (CPG) industry

  • Distribution and Manufacturing industry

Supplier MDM Domain

  • Consumer Packaged Goods (CPG) industry

  • Distribution and Manufacturing industry

  • Retail industry

The customer and supplier master data includes the following elements:

  • Complexity within the customer’s or supplier's organization

  • Complexity within the CPG company’s internal organization – in SAP called the 'Enterprise Structure'

  • MDM must couple the customer's complex organization with the CPG company’s complex internal organization

SAP has a structure that is closely aligned with the reality of these organizations and SAP is also likely the ERP of most of these companies. Therefore, SAP is an important and very useful reference point for understanding these organizations and processes, as well as for understanding what surrounding MDM systems must be able to coexist.

The MDM platform must be able to accommodate the complexities of SAP data structures and processes with basic capabilities for data modeling, user privileges, processes, integrations, and usability.

Background

Many companies in the CPG and manufacturing industries, for example, manage a wide array of products, brands, categories, and channels, and serve diverse customer segments across multiple countries worldwide. The end consumers of products are either individual consumers or businesses like hospitals, schools, restaurants, etc. For CPG and manufacturing companies, typically revenue is generated by selling through a network of retail chains, distributors, and master wholesalers. The company considers these parties their customers. Any CPG or manufacturing company has the following functions as part of the sales side of their business:

  • Sales (including promotion planning, for example)

  • Logistics

  • Accounting and finance

While companies require mastering customer data for understanding and maintaining supplier data as well as for sales purposes, it is equally critical to the business to facilitate purchasing activities, logistics, and other business processes.

Companies often have the following functions as part of the procurement side of the business:

  • Purchasing (including sourcing, soliciting, etc.)

  • Accounting and financing

  • Logistics

It is common for each of these functions to be managed locally (in each country) and to some extent, in each line of business. In many cases, this is a reasonable decentralization of the organization due to the need for regional agility in combination with relatively small optimization gain a centralized organization could have.

Example

Consider CleanGoods Manufacturer, a fictitious CPG company that specializes in cleaning products and operates across two major business units:

  • Traditional household cleaning products - where the end consumer buys the products in a retail store.

  • Clinical products for professionals - where the end consumers are hospitals, doctors, physicians, etc.

Business units sell different and/or the same products and these products are sold and distributed differently via various sales organizations and distribution channels. The same customer may buy products from different product lines. The two business units may also source from the same suppliers.

CleanGoods Manufacturer operates in many countries. Even though CleanGoods deals with international and local companies, it is common for customers to have separate business units in each country.

By mastering supplier data, CleanGoods is better equipped to support the onboarding and maintenance of suppliers across lines of business and to facilitate activities such as negotiating terms of payments, managing supplier rebates, etc.

For information on the general relationships, constraints, and terms used, refer to the SAP R/3 Customer & Supplier, and Enterprise Structure Definitions topic here. For information on the implementation structures of SAP in STEP, refer to the SAP Customer, Supplier, and Enterprise Structures topic here.